Gahoi Chemicals Private Ltd., Kanpur V. ACIT, New Delhi

ITA 3049/DEL/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4790 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 3 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 13-06-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 15-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NAVIN CHAND
• Keywords: Unexplained cash credit; Search and seizure; Principle of natural justice; Reason to believe
• Section: 143(3); 153A; 131; 68; 132; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C , NEW DELHI BEFORE SH. N. K. SAINI, AM AND SH. KULDIP SINGH, JM ITA NO. 3049 /DEL/201 3 : ASSTT. YEAR : 200 5 - 06 ITA NO. 3050/DEL/2013 : ASSTT. YEAR : 2006 - 07 GAHOI CHEMICALS PVT. LTD., B - 8 & 9, PANKI INDL. AREA, KANPUR - 208022 VS ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCAL - 23, NEW DELHI (APPELLANT) (RESPONDENT) PAN NO. AA BCG8027F ASSESSEE BY : SH. SANJAY GARG, CA REVENUE BY : SH. NAVIN CHAND, CIT DR DATE OF HEARING : 31.07 .2017 DATE OF PRONOUNCEMENT : 22 .08.2017 ORDER PER N. K. SAINI, AM: THESE TWO APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDERS EACH DATED 08.02.2013 OF LD. CIT(A) - 33, NEW DELHI. 2. SINCE THE ISSUES INVOLVED ARE COMMON AND THE APPEAL S WERE HEARD TOGETHER SO THESE ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. 3. AT THE FIRST INSTANCE, WE WILL DEAL WITH THE APPEAL IN ITA NO. 3049/DEL/2013 FOR THE ASSESSMENT YEAR 2005 - 06. FOLLOWING GROUND S HAVE BEEN RAISED IN THIS APPEAL: 1.1 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI, ERRED IN LAW IN NOT ADJUDICATING THE GROUND NO. 1.1 OF THE APPEAL BEING BECAUSE THE APPELLANT CANNOT BE HELD TO BE A 'PERSON' SUBJECTED TO VALID SEARCH AND SEIZURE UNDER 2 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. SECTION 132(1) AS THE CONDITION PRECEDENT T O ISSUING OF WARRANT OF AUTHORIZATION DID NOT EXIST NOR SHOWN TO HAVE BEEN SO EXISTING AND THE ASSESSMENT MADE ON HIM UNDER SECTION 153A OF THE INCOME - TAX ACT, 1961 IS WHOLLY WITHOUT JURISDICTION.' 1.2 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI, ERRED IN LA W IN NOT ADJUDICATING THE GROUND NO. 1.2 OF THE APPEAL BEING 'BECAUSE THE LEARNED ASSESSING OFFICER, AT ALL THE STAGES OF THE PROCEEDINGS BEFORE HIM, HAD ALL THE AUTHORITY AND JURISDICTION TO LOOK INTO THE VALIDITY OF SEARCH OPERATION AND IT WAS HIS LEGAL OBLIGATION TO LOOK INTO AND ADJUDICATE UPON THE SAME.' 1.3 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI, ERRED IN LAW IN NOT ADJUDICATING THE GROUND NO. 1.3 OF THE APPEAL BEING 'BECAUSE VALID SEARCH OPERATION IS THE FOUNDATION FOR INVOKING THE PROVISIONS OF S ECTION 153A AND THE ASSESSMENT ORDER PASSED WITHOUT LOOKING INTO AND ADJUDICATING UPON THIS BASIC ISSUE IS LIABLE TO BE DECLARED AS VOID AB - INITIO.' 1.4 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI, ERRED IN LAW IN NOT ADJUDICATING THE GROUND NO. 1.4 OF THE A PPEAL BEING 'BECAUSE THERE EXISTED NO SEARCH WARRANT IN THE NAME OF APPELLANT AS IS EVIDENT FROM THE FACT THAT NO 'PUNCHNAMA' HAS BEEN DRAWN IN THE NAME OF THE APPELLANT 'INDIVIDUALLY' SPEAKING.' 1.5 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI, ERRED IN LAW IN NOT ADJUDICATING THE GROUND NO. 1.5 OF THE APPEAL BEING 'BECAUSE THE SEARCH IS CARRIED OUT WITHOUT SHOWING SEARCH WARRANT TO ANY DIRECTOR / OFFICER / EMPLOYEE OF THE APPELLANT COMPANY AS EV IDENT FROM THE PUNCHNAMA DRAWN. 3 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. 2.1 BECAUSE THE LD. CI T( A) - XXXIII, NEW DELHI, ERRED IN LAW IN NOT ADJUDICATING THE GROUND NO. 2.1 OF THE APPEAL BEING 'BECAUSE APART FROM THE INHERENT LACK OF JURISDICTION ON THE GROUNDS MENTIONED HEREIN FORE, THE NOTICE UNDER SECTION 153A HAS NEITHER BEEN VALIDLY ISSUED NOR SERV ED IN ACCORDANCE WITH THE PROVISIONS OF L AW AND THE ASSESSMENT ORDER PASSED IN PURSUANCE THEREOF, IS LIABLE TO BE DECLARED AS VOID AB - INITIO. 2.2 BECAUSE THE LD. CIT (A) - XXXIII, NEW DELHI, ERRED IN L AW IN NOT ADJUDICATING THE GROUND NO. 2.2 OF THE APPEAL BEING 'BECAUSE, THE ISSUANCE OF NOTICE DATED 30.11.2009 UNDER SECTION 153A VIOLATED THE PROVISIONS OF NATURAL JUSTICE AND GOOD CONSCIENCE, IN AS MUCH AS THE APPELLANT WAS REQUIRED TO FILE THE RETURN, WITHOUT EVEN MAKING HIM AVAILABLE COPIES OF THE SEIZED M ATERIAL, STATEMENT ON OATH ETC. AND PROCEEDINGS THAT HAD ORIGINATED FROM SUCH A NOTICE WERE WH OLLY ILLEGAL AND VOID AB - INITIO. 2.3 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI ERRED IN LAW IN DISMISSING THE APPEAL AND HOLDING THAT VALIDITY OF SEARCH' CAN ONL Y BE QUESTIONED BEFORE HON'BLE HIGH COURT OR HON'BLE SUPREME COURT UNDER WRIT JURISDICTION AND THAT OTHER PROCEEDING SUCH AS DRAWING A SEPARATE PUNCHNAMA, SEPARATE SEARCH WARRANT ETC. DO NOT VITIATE THE VALIDITY OF SEARCH AND THAT IN ANY CASE THE VALIDITY O F SEARCH AND ITS PROCEDURES CAN NOT BE A MATTER OF ADJUDICATION UNDER SECTION 250 OF I.T. ACT AND THAT THERE WAS A VALID SEARCH, ISSUANCE OF NOTICE U/S 153A IS VALID.' 3.1 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI, ERRED IN LAW IN NOT ADJUDICATING THE GROU ND NO. 3.1 OF THE APPEAL BEING 'BECAUSE THE LEARNED ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN COMPUTING THE INCOME OF THE APPELLANT AT RS. 1,00,83,177 / - AS AGAINS T RETURNED LOSS OF RS. 4,17,123/ - SHOWN BY THE APPELLANT IN THE ORIGINAL RETURN AND 4 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. S O ALSO IN THE RETURN FILED IN RESPONS E TO NOTICE UNDER SECTION 153A. 3.2 BE CAUSE THE LD. CIT(A) - XXXIII, NEW DELHI, ERRED IN LAW IN NOT ADJUDICATING THE GROUND NO. 3.2 OF THE APPEAL BEING 'BECAUSE ON A DUE C ONSIDERATION OF FACTS AND CIRCUMSTANCES OF THE CASE, APPRECIATION OF SUBMISSIONS MADE BY THE APPELLANT AT ALL STAGES OF THE ASSESSMENT PROCEEDINGS, THE LEARNED ASSESSING OFFICER SHOULD HAVE ACCEPTED THE APPELLANT'S RETURN AND NO FURTHER TAX/INTEREST SHOULD HAVE BEEN LEVIED ON HIM IN THE IMPUGNED ASSESS MENT.' 3.3 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI, ERRED IN LAW IN NOT ADJUDICATING THE GROUND NO. 3.3 OF THE APPEAL BEING BECAUSE ON A DUE CONSIDERATION OF ATTENDANT FACTS AND CIRCUMSTANCES OF THE CASE, RECEIPTS ON ACCOUNT OF SHARE CAPITAL / SHARE APP LICATION STOOD DULY DISCLOSED IN THE RETURN FILED AND ASSESSED AS PER ORDER DATED 28.12.2007 UNDER SECTION 153A AND THE SAME COULD NOT HAVE BEEN ADVERSELY VIEWED IN THE ASSESSMENT PROCEEDINGS UNDER SECTION 153A, MORE SO WHEN NO ADVERSE MATERIAL WHATSOEVER WAS FOUND DURING THE GLOBAL SEARCH CARRI ED OUT ON THE GROUP AS A WHOLE. 3.4 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI, ERRED IN LAW IN NOT ADJUDICATING THE GROUND NO. 3.4 OF THE APPEAL BEING 'BECAUSE UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE ADDITION MADE TO THE RETURNED LOSS ARE BEYOND THE SCOPE OF PROVISIONS OF SECTION 153A OF THE ACT.' 4.1 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI ERRED IN LAW IN DISMISSING THE GROUND NO. 4.1 OF THE APPEAL THAT BECAUSE THE LD. ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN RE - ADJUDICATING, THE ADJUDICATED SHARE APPLICATION MONEY VIDE ORDER DATED 28.12.2007 PASSED UNDER SECTION 153A OF THE ACT, WITHOUT ANY ADVERSE MATERIAL 5 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. FOUND DURING SEARCH DATED 19.01.2009 AND PLACED ON RECORD.' 5.1 BECAUSE THE LD. CIT(A) - XXXII I, NEW DELHI ERRED IN LAW IN DISMISSING THE GROUND NO. 5.1 OF THE APPEAL THAT BECAUSE THE LEARNED ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT SHARE CAPITAL / SHARE APPLICATION MON EY AMOUNTING TO RS.95 LACS RECEIVED FROM - M/S, SURBHI RESOURCES PRIVATE LIMITED RS. 15,00,000/ - M/S. WELLFIT TRADERS PRIVATE LIMITED RS. 20,00,000/ - M/S. AMICHEM PETRO PRODUCT PVT. LTD. RS. 10,00,000 / - M/S. MADAN REAL ESTATE PVT. LTD. RS. 10,00,000/ - M/S. SHREE LEASING & FINANCE LIMITED RS. 20,0 0, 000/ - M/S. GAURAJ INTERNATIONAL PVT. LTD. RS. 20,00,000/ - TOTAL RS. 95,00,000 / - AS UNEXPLAINED UNDER SECTION 68 OF THE ACT.' 5.2 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI ERRED IN LAW IN DISMISSING THE GROUND NO. 5.2 OF THE APPEAL THAT 'BECAUSE IN THE FACTS THAT ALL SUMMONS ISSUED U/S 131 HAVE BEEN DULY SERVED UPON THE SHARE APPLICANTS COMPANIES BUT HAVE BEEN REMAINED UNCOMPLIED WITH BY THESE COMPANIES MAY FOR VARIOUS REASONS IS PREROGATIVE AND COMMAND OF ASSESSING OFFICER AND NOT ADVERSE MATERIAL AGAINST THE APPELLANT.' 5.3 BECAUSE THE LD. CI T(A) - XXXIII, NEW DELHI ERRED IN LAW IN DISMISSING THE GROUND NO. 5.3 OF THE APPEAL THAT 'BECAUSE IN THE ABSENCE OF ANY ADVERSE MATERIAL HAVING BEEN PLACED ON RECORD AND SO ALSO WITHOUT CONFRONTING THE SAME TO THE ASSESSEE, NO SUCH ADDITION COULD HAVE BEEN MADE BY THE LEARNED ASSESSING OFFICER.' 6 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. 5.4 BECAUSE THE LD. CIT(A) - XXXIII , NEW DELHI ERRED IN LAW IN DISMISSING THE GROUND NO. 5.4 OF THE APPEAL THAT 'BECAUSE ALL THE EVIDENCES IN RELATION TO THE AFORESAID SHARE APPLICATION / SHARE CAPITAL RAISED DURING THE YEAR WERE FURNISHED BY THE APPELLANT AND NO INFIRMITY WAS FOUND THEREIN OR POINTED OUT BY THE ASSESSING OFFICER, THEREFORE, ADDITION IS BASED ON CONJECTURES, SURMISES AND SUSPICION ONLY. 5.5 BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI ERRED IN LAW IN DISMISSING THE GROUND NO. 5.5 OF THE APPEAL THAT 'BECAUSE NO INCRIMINATING MA TERIAL IN RELATION TO THE RECEIPT OF SHARE APPLICATION MONEY / ISSUE OF SHARE CAPITAL WAS FOUND DURING THE COURSE OF GLOBAL SEARCH.' 5 .6 BECAUSE THE LD. CIT(A) - XXXIII , NEW DELHI ERRED IN LAW IN DISMISSING THE APPEAL AND HOLDING 'VALIDITY OF JURISDICTION F OR THIS ASSESSMENT YEAR ON THE BASIS OF SEARCH MATERIAL RELATING TO STOCK FOR OTHER ASSESSMENT YEARS.' 6. BECAUSE THE LD. CIT(A) - XXXIII, NEW DELHI, ERRED IN LAW IN NOT ADJUDICATING THE GROUND NO. 6 OF THE APPEAL BEING 'BECAUSE INTEREST UNDER VARIOUS SECTI ONS COULD NOT HAVE BEEN INCLUDED IN THE COMPUTATION OF TAX DEMAND.' 7. BECAUSE THE ORDER APPEALED AGAINST IS CONTRARY TO FACT, LAW AND PRINCIPLES OF NATURAL JUSTICE. 4. FROM THE AFORESAID GROUNDS, IT IS GATHERED THAT THE M AIN GRIEVANCE OF THE ASSESSEE IN THIS APPEAL RELATES TO THE SUSTENANCE OF ADDITI ON MADE BY THE AO U/S 15 3A OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) IN THE ABSENCE OF INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. 7 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. 5. FACTS OF THE C ASE IN BRIEF ARE THAT THE ASSESSEE FILED ITS ORIGINAL RETURN OF INCOME ON 31.10.2005 DECLARING A LOSS OF RS.4,17,123, WHICH WAS PROCESSED U/S 143(1) OF THE ACT. IN THE PRESENT CASE, A GLOBAL SEARCH U/S 132 OF THE ACT WAS CARRIED OUT ON 01.09.2005 IN THE KU RELE GROUP OF CASES TO WHICH THE ASSESSEE BELONGS AND THE ASSESSEE S CASE WAS CENTRALIZED FROM KANPUR TO DELHI. A NOTICE U/S 153A OF THE ACT WAS ISSUED TO THE ASSESSEE. IN RESPONSE TO THE SAID NOTICE, THE RETURN SHOWING A LOSS OF RS.4,17,123/ - (SAME AS IN THE ORIGINAL RETURN) WAS FILED ON 10.05.2007. HOWEVER, THE ASSESSMENT U/S 153A R.W.S. 143(3) OF THE ACT WAS COMPLETED AT AN INCOME OF RS.5,83,1 77/ - VIDE ORDER DATED 28.12.2007. THEREAFTER, A SEARCH AND SEIZURE OPERATION WAS AGAIN CARRIED OUT AT THE PREMISE S OF THE ASSESSEE ON 19.01.2009 AND NOTICE U/S 153A OF THE ACT WAS ISSUED ON 30.11.2009. IN RESPONSE TO THE SAID NOTICE, THE ASSESSEE FILED THE RETURN OF INCOME ON 15.02.2010 DECLARING A LOSS OF RS.14,28,183/ - . DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO NOTICED THAT IN THE BALANCE SHEET , BEEN SHOWN AS THE ISSUED SHARE CAPITAL OF THE ASSESSEE COMPANY HAD INCREASED FROM RS.1,02,000/ - TO RS.1,06,02,000/ - . THE AO ASKED THE ASSESSEE TO F URNISH THE COMPLETE DETAILS OF SUBSCRIBED AND PAID UP SHARE CAPITAL OF RS.1,06,02,000/ - . THE ASSESSEE SUBMITTED THE DETAILS OF PAID UP SHARE CAPITAL AS UNDER: S. NO. NAME OF SHAREHOLDERS AMOUNT DOCUMENTARY EVIDENCE IN ORDER TO SUBSTANTIATE THE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS. 1. M/S. SURBHI RESOURCES PRIVATE LIMITED RS. 15, 0 0 ,000 COPY OF ACKNOWL EDGEMENT OF E - RETURN OF COMPANY, DIRECTOR'S REPORT , AUDITOR'S REPORT, BALANCE 8 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. SHEET, PROFIT AND LOSS ACCOUNT WITH ANNEXURE 2. M/S. WELLFIT TRADERS PRIVATE LIM I TED RS. 20,00,000 COPY OF ACKNOWLEDGEMENT OF E - RETURN OF COMPANY, DIRECTOR'S REPORT , AUDITOR'S REPORT, BALANCE SHEET, PROFIT AND LOSS ACCOUNT WITH ANNEXURE 3. M/S. AMICHEM PETRO PRODUCT PVT. LTD. RS. 10,00,000 COPY OF ACKNOWLEDGEMENT OF E - RETURN OF COMPANY, DIRECTOR'S REPORT , AUDITOR'S REPORT, BALANCE SHEET, PROFIT AND LOSS ACCOUNT WITH ANNEXURE 4. M/S. MADAN REAL ESTATE PRIVATE LT D. RS. 10,00,000 COPY OF ACKNOWL EDGEMENT OF E - RETURN OF COMPANY, DIRECTOR'S REPORT , AUDITOR'S REPORT, BALANCE SHEET, PROFIT AND LOSS ACCOUNT WITH ANNEXURE 5. M/S. JEEVANDHARA WATERS PVT. LTD. RS. 10,00,000 C OPY OF ACKNOWL EDGEMENT OF E - RETURN OF COMPANY, DIRECTOR'S REPORT , AUDITOR'S REPORT, BALANCE SHEET, PROFIT AND LOSS ACCOUNT WITH ANNEXURE 6. M/S. SHREE LEASING & FINANCE LIMIT ED RS. 20,00,000 COPY OF. ACKNOWLEDGEMENT OF E - RETURN OF COMPANY , DIRECTOR'S REPORT , AUDITOR'S REPORT, BALANCE SHE ET, PROFIT AND LOSS ACCOUNT WITH ANNEXURE 7. M/S. GAURAJ INTERNATIONAL PRIVATE LIMITED RS. 20,00,000 COPY OF ACKNOWL EDGEMENT OF E - RETURN OF COMPANY, DIRECTOR'S REPORT , AUDITOR'S REPORT, BALANCE SHEET, PROFIT AND LOSS ACCOUNT WITH ANNEXURE TOTAL RS. 1,05,00,000 THE ASSESSEE SUBMITTED THAT THE ISSUE RELATING TO SHARE CAPITAL HAD ALREADY BEEN ADJUDICATED VIDE ASSESSMENT ORDER DATED 28.12.2007 PASSED U/S 153A OF THE ACT. THE RELIANCE WAS ALSO PLACED ON THE JUDGMENT OF THE HON BLE SUPREME COURT IN THE CASE OF CIT VS LOVELY EXPORT PVT. LTD. 6 . THE AO ASKED THE ASSESSEE TO PRODUCE THE D IRECTORS OF THE SHARE APPL ICANT COMPANIES FOR PERSONAL DEPOSITION. IN COMPLIANCE, THE 9 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. ASSESSEE ATTENDED THE PROCEEDINGS AND FURNISHED A LETTER DATED 25.12.2010. THE AO DID NOT FIND MERIT IN THE SUBMISSION OF THE ASSESSEE AND OBSERVED THAT THE LETTER DATED 25.12.2010 WAS NOTHING BUT THE REPETITION OF FACTS GIVEN IN THE EARLIER LETTER DATED 06.12.2010. HE ALSO OBSERVED THAT THE ASSESSEE HAD SHOWN ITS INABILITY TO PRODUCE THE PARTIES ON THE PRETEXT THAT THOSE COMPANIES WERE NOT THE ASSESSEE S SISTER CONCERN S AND WERE ALSO NOT UNDER ITS INFLUENCE OF CONTROL. THE AO MADE THE ADDITION OF RS.1,05,00,000/ - U/S 68 OF THE ACT AND ALSO ADDED RS.10,00,000/ - IN RESPECT OF SHARE CAPITAL ON ACCOUNT OF M/S JEEVANDHARA WATERS PVT. LTD. THE RELIANCE WAS PLACED ON THE DECISION OF THE ITAT DELHI BENCHES IN THE CASE OF M/S AMTRAC AUTOMOBILES INDIA PVT. LTD. VS ACIT, CIRCLE - 1(1), NEW DELHI IN ITA NO. 2920/DEL/2009. 7 . BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT( A) AND FURNISHED THE WRITTEN SUBMISSION WHICH IS SUMMARIZED BY THE LD. CIT(A) IN PARA 5.2 OF THE IMPUGNED ORDER , AS UNDER: (I) DURING THE YEAR UNDER APPEAL APPELLANT FILED ITS RETURN OF INCOME IN RESPONSE TO NOTICE U/S 153A OF THE INCOME TAX ACT, 1961 ON 15 - 02 - 2010 DECLARING A LOSS OF RS. 14,28,183 / - . AGAINST THIS RETURN OF INCOME ASSESSEE IS ASSESSED AT THE INCOME OF RS.L,00,83,177 / - VIDE ORDER PASSED U/S 153A / 143(3) OF THE INCOME TAX ACT, 1961 29.12. 2010. IN THE AUDITED BALANCE SHEET OF THE COMPANY SHA RE CAPITAL / SHARE APPLICATION MONEY RECEIVED TO THE TUNE OF RS. 1,05,00,000 / - WAS DULY DISCLOSED AND THIS IS ASSESSED VIDE ORDER DATED 28.12.2007 PASSED U/S 153A OF THE IT. ACT, BY A.O. BEING DC1T - CC - 23, NEW DELHI. THERE WAS NOTHING ADVERSE AGAINST THE ASSESS EE APPELLANT IN ANY RESPECT. 10 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. (II) DURING ORIGINAL ASSESSMENT PROCEEDINGS U/S 143(3) IN RESPONSE TO NOTICE DATED 10 - 10 - 2007 BEFORE A.O., RANGE 6(1) KANPUR; THE APPELLANT COMPANY HAS FILED FOLLOWING DOCUMENTS/ EVIDENCES TO SUPPORT THE ENTRIES OF SHARE APPLICANTS : - THE DETAILS OF SHARE APPLICANTS COMPANY ARE AS PER FOLLOWINGS: M/S. SU RBHI RESOURCES PRIVA TE LIMITED OLD ADDRESS - KESAR APARTMENT, B - 4, JH OTAWALA ROAD, KOLKATA - 700059 NEW ADDRESS - 67B, BALLYGUNGE CIRCULAR ROAD, PARK TOWER, 4 TH FLOOR, ROOM NO. B - 12, KOLKATA - WEST BENGAL 700019 INDIA PAN - AAHCS9873M PRESENTLY ASSESSED UNDER - AREA CODE WBG, JURISDICTION ITO - WD - 10(4), CALCUTTA BUILDING - 3, GOVT. PLACE WEST, CALCUTTA. WE ENCLOSED THEREWITH COPY OF ACKNOWLEDGEMENT OF IT RETURN FOR A. Y. 2005 - 06 , SHARE APPLICATION FORM, COPY OF BANK STATEMENT OF IDBI BANK, DIRECTOR'S REPORT, AUDITORS REPORT, BALANCE SHEET, PROFIT & LOSS ACCOUNT WITH ANNEXURES F. Y. 2004 - 05. FROM THIS COM PANY WE HAVE RECEIVED SHARE APPLICATION MONEY OF RS. 15,00,000/ - VIDE CHEQUE NO. 204228 DATED 21. 6.2004 DRAWN ON IDBI BANK, PARK STREET, CALCUTTA. THIS HAS BEEN DULY DISCLOSED IN THE SCHEDULE - 3 OF INVESTMENT TO THE BALANCE SHEET. THERE ARE INVESTMENTS OF THE COMPANY TO THE TUNE OF RS.2,68,85,000/ - WHICH INCLUDES SHARE APPLICATION MONEY PAID TO US. THE COMPANY IS OF SUBSTANTIAL WORTH. 11 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. WE FURTHER ENCLOSED THEREWITH THE EXTRACT FROM THE RECORD OF MCA OF GOVERNMENT OF INDIA PORTAL TO EVIDENCE THE CHANGE OF AD DRESS. M/S. WELLFIT TRADERS PRIVA TE LIMITED OLD ADDRES S - 7, GRANT LANE, ROOM NO. 217, KOLKATA - 700012. NEW ADDRESS - B - 4, KESHAR APARTMENT, JHOWTALA ROAD, KOLKATA , WEST BENGAL - 700059. PAN - AAACW4232D PRESENTLY ASSESSED UNDER - AREA CODE WBG, JURISDICTION ITO - WD - (2), KOLKAT A B UILDING - AAYAKAR BHAVAN, KOLKAT A. WE ENCLOSED THEREWITH COPY OF ACKNOWLEDGEMENT OF IT RETURN FOR A. Y. 2005 - 06, SHARE APPLICATION FORM, COPY OF BANK STATEMENT OF IDBI BANK, DIRECTOR'S REPORT, AUDITORS REPORT, BALANCE SHEET, PROFIT & LOSS ACCOUNT WITH ANNEXURES F. Y. 2004 - 05. FROM THIS COMPANY W E HAVE RECEIVED SHARE APPLICATION MONEY OF RS.20,00,000/ - VIDE CHEQUE NO. 041211 DATED 21.6.2004 DRAWN ON ID BI BANK, PARK STREET, CALCUTTA. THIS HAS BEEN DULY DISCLOSED IN THE SCHEDULE - 3 OF INVESTMENT TO THE BALANCE SHEET. THERE ARE INVESTMENTS OF THE COMPANY TO THE TUNE OF RS.3,22,50,000/ - WHICH INCLUDES SHARE APPLICATION MONEY PAID TO US. THE COMPANY IS OF SUBSTANTIAL WORTH. WE FURTHER ENCLOSED THEREWITH THE EXTRACT FROM THE RECORD OF MCA OF GOVERNMENT OF INDIA PORTAL TO EVIDENCE THE CHANGE OF ADDRESS. AMICHEM PETRO PRODUCTS PRIVATE LIMITED 12 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. REGD. OFFICE - 4, BALLAV DAS ST 4 TH FLOOR JORASANKO, KOLKATA, WEST BANGAL - 700007 INDIA THE NAME OF THE COMPANY IS CHANGED FROM CORONET INDUSTRIES LIMITED (PAN - AABCC2872L) TO PRESENT NAME UPON AMALGAMATION OF THIS COMPANY INTO AMICHEM PETRO PRODUCTS PRIVATE LIMITED AFTER ORDER OF CALCUTTA HIGH COURT PASSED IN COMPANY PETITION NO. 316 OF 2005 DATED 13.9.2005 WHICH IS ENCLOSED HERE WITH. WE ENCLOSED THEREWITH COPY OF ACKNOWLEDGEMENT OF IT RETURN FOR A. Y. 2005 - 06 , DIR ECTOR'S REPORT, AUDITORS REPORT, BALANCE SHEET, PROFIT & LOSS ACCOUNT WIT H ANNEXURES F.Y. 2004 - 05. FROM THIS COMPANY WE HAVE RECEIVED SHARE APPLICATION MONEY OF RS.10 ,00,000 / - VIDE CHEQUE NO. 408381 DATED 22.07.2004 DRAWN ON AB N AMRO BANK BR. ROAD, KOLKATA . THIS HAS BEEN DULY DISCLOSED IN THE SCHEDULE - D OF INVESTMENT TO THE BALANCE SHEET OF SHARE APPLICANT COMPANY. THIS IS ALSO DISCLOSED IN PORTFO LIO STATEMENT - EN TRY DATED 22. 7.2004. THERE ARE INVESTMENTS OF THE COMPANY TO THE TUNE OF RS. 7,60,14,600/ - WHICH INCLUDES SHARE APPLICATION MONEY PAID TO US. THE COMPANY IS OF SUBSTANTIAL WORTH. MADAN REAL ESTATE PRIVATE LIMITED NEW NAME - MAA GAY ATRI AGENCIES PRIVATE LIMITED , 4, BALLAV DAS STREET, 4 TH FLOOR, KOLKATA - 700007. PAN - AABCM9327N PRESENTLY ASSESSED UNDER - AREA CODE WBG, JURISDICTION ITO - WD - 1 (2), KOLKALA BUILDING - AAYAKAR BHAVAN, KOLKATA. 13 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. WE ENCLOSED THEREWITH COPY OF ACKNOWLEDGEMENT OF IT RETURN FOR A. Y. 2005 - 06 , DIRECTOR'S REPORT, AUDITORS REPORT, BALANCE SHEET , PROFIT & LOSS ACCOUNT WITH ANNEXURES F. Y. 2004 - 05. FROM THIS COMPANY WE HAVE RECEIVED SHARE APPLICATION MONEY OF RS. 10,00,000/ - VIDE CHEQUE NO. 470101 DATED 20.07.2004 DRAWN ON ID BI BANK, PARK S TREET, CALCUTTA. THIS HAS BEEN DULY DISCLOSED IN THE SCHEDULE - C OF INVESTMENT TO THE BALANCE SHEET OF SHARE APPLICANT COMPANY. THERE ARE INVESTMENTS OF THE COMPANY TO THE TUNE OF RS.2,65,01,500.00 WHICH INCLUDES SHARE APPLICATION MONEY PAID TO US. THE COMPANY IS OF SUBSTANTIAL WORTH. WE FURTHER ENCLOSED THEREWITH THE EXTRACT FROM THE RECORD OF MCA OF GOVERNMENT OF INDIA PORTAL TO EVIDENCE THE CHANGE OF NAME FROM MADAN LAL REAL ESTATE PRIVATE LIMITED TO MAA GAYATRI AGENCIES PRIVATE LIMITED AND ALSO CERTIFICATE OF ROC DATED 02.06.2006. JEEVANDHARA WA TERS PR1VA TE LIMITED NEW NAME - NARAYANI POLYTUBE PRIVA TE LIMITED 4, BALLAY DAS STREET,4 TH FLOOR, KOLKATA - 700007 CIN - 88801 PAN - AABCJ3665Q PRESEN TLY ASSESSED UNDER - AREA CODE WBG, JURISDICTION ITO - WD - 9(3), KOLKAT A BUILDING - AAYAKAR BHARAN, KOLKA T A. WE ENCLOSED THEREWITH COPY OF ACKNOWLEDGEMEN T OF IT RETURN FOR A.Y. 2005 - 06 , DIR ECTOR'S REPORT, AUDITORS REPORT , BALANCE SHEE T , PROFIT & LOSS ACCOUNT WITH ANNEXURES F. Y. 2004 - 05. FROM THIS COMPANY WE HAVE RECEIVED SHARE APPLICATION MONEY OF RS.1 0 ,0 0,000/ - VIDE CHEQUE NO. 038546 DATED 14 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. 20.7.2004 DRAWN ON ABN AMRO BANK BR. ROAD, KOLKATA. THIS HAS BEEN DULY DISCLOSED IN THE SCHEDULE - C OF INVESTMENT TO THE BALANCE SHEET. THERE ARE INVESTMENTS OF THE COMPANY TO THE TUNE OF RS.5,18,44,000/ - WHICH INCLUDES SHARE APPLICATION MONEY PAID TO US. THE COMPANY IS OF SUBSTANTIAL WORTH. WE FURTHER ENCLOSED THEREWITH THE EXTRACT FROM THE RECORD OF MCA OF GOVERNMENT OF INDIA PORTAL TO EVIDENCE THE CH ANGE OF N AME FROM JEEVANDHARA W ATERS PRIVATE LIMITED TO NARAYANI POLYTUBE PRIVATE LIMITED. SHREE LEASING & FINANCE LIMITED OLD ADDRESS - 61, ZONE - B, MANCHESHWAR, BHUWANESHWAR - 751010 NEW ADDRESS - MERIA BAZAR, OLD USHA COMPANY GODOWN CAMPUS, CUTTACK, ORISSA - 75 3001 INDIA CIN - 002880 PAN - AAGCS7858D PRESENTLY ASSESSED UNDER - AREA CODE WBG, JURISDICTION ITO - WD - 2/BERHAMPUR, BUILDING - BEHERAMPUR, ORISSA. WE ENCLOSED THEREWITH COPY OF ACKNOWLEDGEMENT OF IT RETURN FOR A. Y. 2005 - 06 , COPY OF BANK STATEMENT, DIRECTOR'S REPORT, AUDITORS REPORT, BALANCE SHEET, PROFIT & LOSS ACCOUNT WITH ANNEXURES F. Y. 2004 - 05. FROM THIS COMPANY WE HAVE RECEIVED SHARE APPLICATION MONEY OF RS. 20,00,000 / - VIDE CHEQUE NO. 626659 DATED 20.07.2004 DRAWN O N IDBI BANK, BRABOURNE ROAD, CALCUTTA. THIS HAS BEEN DULY DISCLOSED IN THE SCHEDULE - D OF INVESTMENT TO THE BALANCE SHEET. THERE ARE INVESTMENTS OF THE COMPANY TO THE TUNE OF RS.8,49,03,000/ - WHICH INCLUDES SHARE APPLICATION MONEY PAID TO US. THE COMPANY IS OF SUBSTANTIAL WORTH. 15 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. WE FURTHER ENCLOSED THEREWITH THE EXTRACT FROM THE RECORD OF MCA OF GOVERNMENT OF INDIA PORTAL TO EVIDENCE THE CHANGE OF ADDRESS. GAVRAJ INTERNATIONAL PRIVATE LIMITED REGD. OFFICE - K ESHAR APARTMENT, JHUWTALA ROAD, B/4, K OLKATA - 700059 INDIA C 1N - 48102 PAN - AACCG08I6F PRESENTLY ASSESSED UN DER - AREA CODE WBG, JURISDICTION DCIT - CIRCLE - 10, CALCUTTA, BUILDING - 3, GOVT. PLACE WEST, CALCUTTA. WE ENCLOSED THEREWITH COPY OF ACKNOWLEDGEMEN T OF IT RETURN FOR A.Y. 2005 - 06 , COPY OF BANK STATEMENT, DIR ECTOR'S REPORT, AUDITORS REPORT, BALANCE SHEET , PROFIT & LOSS ACCOUNT WITH ANNEXURES F. Y. 2004 - 05. FROM THIS COMPANY WE HAV E RECEIVED SHARE APPLICATION MONEY OF RS. 20,00,000/ - VIDE CHEQUE NO. 5569 79 DATED 27.7.2004 DRAWN ON IDBI BANK, BRABOU RNE ROAD, CALCUTTA. THIS HAS BEEN DULY DISCLOSED IN THE SCHEDULE - 3 OF INVESTMENT TO THE BALANCE SHEET. THERE ARE INVESTMENTS OF THE COMPANY TO THE TIME OF RS.2,37,53,000/ - WHICH INCLUDES SHARE APPLICATION MONEY PAID TO US. THE COMPANY IS OF SUBSTA NTIAL WORTH. WE HAVE FILED HIS SHARE APPLICATION FORM AND CONFIRMATION TOWARDS PAYMENT OF SHARE APPLICATION MONEY WHICH ARE ON RECORD. WE HAVE ALREADY FILED THE DRAWN STATUS REPORT OF THESE COMPANIES FROM THE PORTAL OF MINISTRY OF CORPORATE AFFAIRS, GOV ERNMENT OF INDIA IN WHICH THE ADDRESS OF REGISTERED OFFICE OF THE COMPANY IS DULY MENTIONED. ALL THE COMPANIES ARE DULY APPEARING IN THE PORTAL OF MINISTRY OF CORPORATE AFFAIRS. 16 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. THE SHARES AGAINST SHARE APPLICATION MONEY HAS BEEN ALLOTTED VIDE RESOLUTION O F BOARD OF DIRECTORS AND DUE FORM HAS BEEN SUBMITTED TO THE REGISTRAR OF COMPANIES, THROUGH MCA PORTAL. (III) THE ASSESSING OFFICER IN ORIGINAL ASSESSMENT HAS ACCEPTED THE SUBMISSION OF THE APPELLANT COMPANY AND NO ADDITION WAS MADE WHILE PASSING THE ORIG INAL ASSESSMENT ORDER DATED 31 - 12 - 2008 WHICH WAS FILED BEFORE THE ASSESSING OFFICER IN CURRENT ASSESSMENT PROCEEDINGS ALSO. (IV) 'ASSESSMENT' AND 'REASSESSMENT' ARE SAME WHETHER IT IS UNDER SECTION 14 3 (3), 147 OR 153A OF IT. ACT, HE ARGUED THAT U/S 147 TH ERE ARE JUDICIAL PRONOUNCEMENT THAT SECTION 147 DOES NOT CONFER POWER OF REVIEW TO THE ASSESSING OFFICER. (V) LD. AR ARGUED THAT ASSESSMENT UNDER SECTION 153A HAS TO BE RESTRICTED TO THE EVIDENCE FOUND AS A RESULT OF SEARCH U/S 132. HE RELIED UPON THE DECISION OF HON'BLE H.C. OF ALLAHABAD IN THE CASE CIT(C) VS. KANPUR VS. SUIT SHAILA AGGARWAL (2011) 16 TAXMANN .CO M 232 (ALL.), MEGHMANI ORGANICS LTD. VS. DCIT, AHMEDABAD (2010) 6 ITR (TRIB) 360 (AHM.), LMJ INTERNATIONAL LTD. (2008) 119 TTJ 214 (CALCUTTA). 8. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE OBSERVED THAT THE JURISDICTION OF THE ASSE SSING OFFICER U/S 153A OF THE ACT IS TO ASSESS TOTAL INCOME FOR THE YEAR AND NOT RESTRICTED TO SEIZED MATERIAL. THE RELIANCE WAS PLACED ON THE JUDGMENT OF THE HON BLE DELHI HIGH COURT IN THE CASE OF ANIL KUMAR BHATIA IN ITA NOS. 1626, 1632, 1998, 2006, 201 9 & 2010 OF 2010 ORDER DATED 07.08.2012. THE LD. CIT(A) FURTHER OBSERVED THAT AS A RESULT OF SEARCH AND SEIZURE , DOCUMENTS WERE SEIZED AND THE ADDITION HAD BEEN MADE ON 17 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. UNACCOUNTED STOCK FOR OTHER ASSESSMENT YEAR U/S 153A OF THE ACT I.E. FOR THE ASSESSMENT YEARS 2007 - 08 AND 2008 - 09. THEREFORE, THERE WERE SEIZED MATERIALS PERTAINING TO OTHER ASSESSMENT YEARS WITHIN THE PERIOD OF SIX YEARS U/S 153A OF THE ACT. THE LD. CIT(A) HELD THAT THE AO HAD THE JURISDICTION TO ASSESS TOTAL INCOME INCLUDING ADDITION U/S 6 8 OF THE ACT FOR SHARE CAPITAL OR SHARE APPLICATION MONEY, EVEN THOUGH NO ADDITION WAS MADE IN ORIGINAL ASSESSMENT PROCEEDINGS. THE LD. CIT(A) OBSERVED THAT ON THE BASIS OF DOCUMENTS PROVIDED BY THE ASSESSEE, THE AO MADE FRESH ENQUIRY BY ISSUING SUMMONS U/ S 131 OF THE ACT CALLING FOR VARIOUS DETAILS IN SUPPORT OF GENUINENESS OF TRANSACTION AND THAT ALL THE SUMMONS WERE NOT EITHER COMPLIED WITH OR RECEIVED BACK UNSERVED. THE RESULT OF ENQUIRY WAS INTIMATED BY THE AO TO THE ASSESSEE BY WRITING A LETTER AND IN RESPONSE TO THE SAID LETTER, THE ASSESSEE SUBMITTED REPLY BUT HAD SHOWN INABILITY TO PRODUCE THOSE SHARE APPLICANTS BY PERSON. THE LD. CIT(A) OBSERVED THAT AFTER THE FURNISHING OF INFORMATION BY THE ASSESSEE U/S 68 OF THE ACT, T HE AO MADE ENQUIRY WHICH RA ISED DOUBTS ON THE GENUINENESS OF THE TRANSACTION, THE ONUS SHIFTED BACK ON THE ASSESSEE TO PROVE THE GENUINENESS OF THE TRANSACTION AND CREDIT WORTHINESS OF THE CREDITORS. THE RELIANCE WAS PLACED ON THE JUDGMENT OF THE HON BLE DELHI HIGH COURT IN THE CASE OF CIT VS M/S N. R. PORTFOLIO PVT. LTD. IN ITA NO. 134 OF 2012 ORDER DATED 21.12.2012. THE LD. CIT(A) CONFIRMED THE ADDITION MADE BY THE AO BY OBSERVING AS UNDER: IN VIEW OF ABOVE JUDICIAL PRONOUNCEMENT. I THINK, ONCE THE ASSESSING OFFICER HAS DOUBTED TH E DOCUMENTS FURNISHED BY APPELLANT AND CONDUCTED ENQUIRY WHICH CREATES DOUBTS 18 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. ABOUT GENUINENESS OF THE TRANSACTION, THE ONUS HAS SHIFTED ON THE APPELLANT TO PRODUCE THE SHARE APPLICANT IN PERSON OR REBUT THE ENQUIRY. THE APPELLANT HAS CHOOSEN TO PRODUCE TH E SHARE APPELLANT IN PERSON NOR REBUTTED THE ENQUIRY EITHER BEFORE A.O. OR BEFORE THE UNDERSIGNED. LD. AR'S OTHER ARGUMENT IS THAT ON SAME FACTS, A.O. HAS NOT MADE ADDITION IN FIRST ROUND OF ASSESSMENT THEREFORE ON SAME FACTS, IF ADDITION IS MADE, IT AMOUN TS TO REVIEW. I DO NOT AGREE WITH THIS ARGUMENT. IN SECOND ROUND, ON CHANGED CIRCUMSTANCES THE ASSESSING OFFICER HAS CONDUCTED ENQUIRY BY ISSUING SUMMONS WHICH REMAINS UNCOMPLIED. HENCE, THE PRESENT ADDITION IS JUST NOT ON SAME FACTS. IN VIEW OF THE ABOVE, & CONSIDERING FACTS & CIRCUMSTANCES OF THE CASE, I CONFIRM THE ADDITION MADE BY A.O. U/S 68 & DISMISS THE GROUND OF APPEAL. 9 . NOW THE ASSESSEE IS IN APPEAL. THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND FURTHER SUBMITTED THAT THE ISSUE RELATING TO RECEIPT OF SHARE APPLICATION MONEY WAS DULY EXAMINED WHILE PASSING THE ORDER DATED 28.12.2007 U/S 153 A R.W.S. 143 (3) OF THE ACT AND THEREAFTER SEARCH AND SEIZURE OPERATION U/S 132 OF THE ACT WAS AGAIN CARRIED OUT ON THE ASSESSEE ON 19.01.2009 BUT NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH, SO AS TO IMPINGE UPON THE RECEIPT OF SHARE CAPITAL , STILL THE AO BASED UPON THE NOTICE SENT IN OTHER CASE S TO THE SHARE APPLICANT S WHICH HAD REMAINED UNCOMPLIED ASKED THE ASSESSEE TO PRODUCE THE DIRECTOR S OF THE SHARE APPLICANT S . IT WAS STATED THAT ALTHOUGH ASSESSMENT ORDER WAS MADE U/S 153A OF THE ACT, HOWEVER, NO REFERENCE WAS MADE TO ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. AS SUCH, THE ADDITION MADE BY THE AO AND SUSTAINED 19 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. BY THE LD. CIT(A) WAS NOT JUSTIFIED. THE RELIANCE WAS PLACED ON THE FOLLOWING CASE LAWS: CIT VS LANCY CONSTRUCTIONS ( 2016) 237 TAXMAN 728 (KAR.) CIT VS KABUL CHAWLA (2016) 380 ITR 573 (DEL.) CIT VS ANIL KUMAR BHATIA (2013) 352 ITR 493 (DEL.) CIT VS CHETAN DAS LACHMAN DAS (2012) 211 TAXMAN 61 (DEL.) MADUGULA VENU VS DIT (2013) 215 TAXMAN 298 (DEL.) CANARA HOUSING DEVELOPM ENT CO. VS DCIT ORDER DATED 25.07.2014 (KAR. HC) FILATEX INDIA LTD. VS CIT (2014) 49 TAXMAN 465 (DEL.) CIT VS KURELE PAPER MILLS P. LTD. IN ITA NO. 369 OF 2015 ORDER DATED 06.07.2015 JAI STEEL (INDIA) VS ACIT (2013) 36 TAXMAN 523 (RAJ.) CIT VS CONTINENTAL WAREHOUSING CORPORATION (NHAVA SHEVA) LTD. (2015) 374 645 (BOM.) BEST INFRASTRUCTURE (INDIA) PVT. LTD. & ORS. VS ACIT & ORS. (2016) 47 CCH 159 (DEL. TRIB.) CIT VS NOVA PROMOTERS & FINLEASE (P) LTD. 342 ITR 169 (DEL.) CIT VS GANGESHWARI METAL (P) LTD. (2014 ) 361 ITR 10 (DEL.) CIT VS ORISSA CORPORATION (P) LTD. (1986) 159 ITR 78 (SC) PR. CIT VS SOFTLINE CREATIONS (P) LTD. (2016) 387 ITR 636 (DEL.) CIT VS MEETA GUTGUTIA (2017) 395 ITR 526 (DEL.) 10 . THE LD. COUNSEL FOR THE ASSESSEE ALSO STATED THAT ADDITIONS ON ACCOUNT OF STOCK WERE MADE FOR THE ASSESSMENT YEAR 2007 - 08 BUT THE LD. CIT(A) DELETED THOSE ADDITIONS AND FOR THE ASSESSMENT YEAR 2008 - 09, THE MATTER IS STILL PENDING BEFORE THE EXCISE DEPARTMENT. THEREFORE, THE ALLEGATION OF THE AO THAT IN THE SUBSEQUENT YEARS, THE 20 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. ADDITIONS WERE MADE ON THE BASIS OF INCRIMINATING DOCUMENTS FOUND DURING THE COURSE OF SEARCH , WAS NOT CORRECT. IT WAS SUBMITTED THAT THE ADDITION MADE BY THE AO AND SUSTAINED BY THE LD. CIT(A) IN THE ABSENCE OF AN Y INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH WAS NOT JUSTIFIED. 11 . IN HIS RIVAL SUBMISSIONS THE LD. DR REITERATED THE OBSERVATIONS MADE BY THE AUTHORITIES BELOW AND STRONGLY SUPPORTED THE IMPUGNED ORDER PASSED BY THE LD. CIT(A). IT WAS FURT HER SUBMITTED THAT AS A RESULT OF SEARCH AND SEIZURE DOCUMENTS WERE SEIZED ON THE BASIS OF WHICH ADDITION S HAD BEEN MADE ON ACCOUNT OF UNACCOUNTED STOCK FOR OTHER ASSESSMENT YEARS I.E. ASSESSMENT YEARS 2007 - 08 AND 2008 - 09 U/S 153A OF THE ACT. THEREFORE, TH E SEIZED MATERIAL CAN BE RELIED UPON TO DRAW THE INFERENCE THAT THERE CAN BE SIMILAR TRANSACTIONS THROUGHOUT THE PERIOD OF SIX YEARS COVERED U/S 153A OF THE ACT. IT WAS FURTHER STATED THAT INCRIMINATING MATERIAL NEED NOT BE ACTUAL PHYSICAL DOCUMENT AND THA T ANY PIECE OF INFORMATION CAPABLE OF INFLUENCING MIND OF THE AO TO THE EXTENT OF THE INITI ATION OF ACTION UNDER PROVISION S OF INCOME TAX ACT BECOMES NECESSARY , WOULD BE INCRIMINATING MATERIAL . IT WAS ALSO STATED THAT IT IS ALTOGETHER DIFFERENT THING THAT FINALLY , IT MAY OR MAY NOT CULMINATE INTO PECUNIARY LIABILITY IMPOSED UPON THE ASSESSEE. SUCH PIECE OF INFORMATION COULD BE IN THE FORM OF STATEMENT RECORDED OR INVENTORY MADE OR NOTICING OF CIRCUMSTANCES OR IN ANY OTHER FORM. IT WAS FURTHER STATED THAT A SINGLE PIECE OF INFORMATION MAY NOT BE INCRIMINATING INDIVIDUALLY BUT WHEN 21 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. PUT IN JUXTAPOSITION OF OTHER INFORMATION S OR CIRCUMSTANCES, IT VERY WELL BECOMES INCRIMINATING AND THAT IN THE PRESENT PIECE OF INFORMATION (MATERIAL) PUT IN JUX TAPOSITION OF THE F ACT THAT NONE OF THE SO - CALLED SHARE HOLDER COMPANIES COMPLIED WITH THE SUMMONS U/S 131 OF T HE ACT AND THE ASSESSEE REFUSED TO PRODUCE THEM , IN SPITE OF BEING CLOSELY HELD COMPANY, CERTAINLY BECAME INCRIMINATING MATERIAL AND IT CERTAINLY HAD GENESIS IN THE SEARCH. IT WAS FURTHER SUBMITTED THAT THE DECISION IN THE CASE OF CIT VS KABUL CHAWLA RELIED BY THE LD. COUNSEL FOR THE ASSESSEE DOES NOT OVERRULE THE RATIO LAID DOWN IN THE CASE OF ANIL KUMAR BHATIA 24 TAXMAN 98 (AS CLARIFIED IN THE CASE OF FILATEX INDIA LTD. 2014 - TIOL - 1325 - HC - DEL - IT). IT WAS FURTHER SUBMITTED THAT IN ANY CASE, AFTER THE SUMMONS U/S 131(1) OF THE ACT REMAINED NON - COMPLIED, ASSESSEE REFUSED TO PRODUCE THE SHAREHOLDER AND PENALTY PROCEEDINGS CULMINATED I NTO LEVYING OF PENALTY AS THE ASSESSE E COULD NOT PUT UP ANY PLAUSIBLE DEFENSE, THERE WA S CERTAINLY FRESH MATERIAL TO FORM REASON TO BELIEVE THAT INCOME HA D ESCAPED ASSESSMENT AND IT IS A CASE OF OTHERWISE DISTURBING COMPLETED ASSESSMENT BUT FOR ON - GOING PROCEEDINGS U/S 153A OF THE ACT. THE RELIANCE WAS PLACED ON THE FOLLOWING CASE LAWS: CIT - VII VS CHETAN DAS LADCHMAN DAS (2012) 25 TAXMANN.COM 227 (DEL.) CIT VS MAITHAN INTERNATIONAL (2015) 56 TAXMANN.COM 283 (CAL.) CIT VS NAVODAYA CASTLE (P.) LTD. (2014) 50 TAXMANN.COM 110 (DEL.) NAVODAYA CASTLE (P.) LTD. VS CIT (2015) 56 TAXMANN.COM 18 (SC) 22 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. CIT VS NOVA PROMOTERS & FINLEASE (P) LTD. (2012) 18 TAXMANNL.COM 227 (DEL.) CIT VS N. R. PORTFOLIO (P.) LTD. (2013) 29 TAXMANN.COM 291 (DEL.) CIT VS N. R. PORTFOLIO (P.) LTD. (2014) 42 TAXMANN.COM 339 (DEL.) SUBHLAKSHMI VANIJAYA (P) LTD. VS CIT 60 TAXMANN.COM 60 (KOL - TRIB.) NIIT VS CIT (2015) 60 TAXMANN.COM 313 (DEL. - TR IB. ) 12 . WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CASE, IT IS AN ADMITTED FACT THAT A SEARCH IN THE KURELE GROUP TO WHICH THE ASSESSEE BELONGED WAS CARRIED OUT F IRST TIME ON 01.09.2005 AND THE ASSESSMENT U/S 15 3A OF THE ACT WAS FRAMED ON 28.1 2.2007 WHICH IS EVIDENT FROM PAGE NOS. 14 TO 16 OF THE ASSESSEE S PAPER BOOK. THE AO DISCUSSED THE ISSUE RELATING TO SHARE CAPITAL IN PARAS 1 TO 1.2 OF THE ORDER DATED 28.12.2 007 WHICH REPRODUCED VERBATIM AS UNDER: 1.1 ON PERUSAL OF THE BALANCE SHEET AS AT 31.3.2005 IT HAS BEEN NOTICED THAT THE PAID SHARE CAPITAL OF THE ASSESSEE COMPANY HAS BEEN INCREASED FROM RS.102,000/ - TO RS.10,602,000/ - I.E. THERE IS AN INCREASE OF RS.10,500,000/ - IN THE PAID UP SHARE CAPITAL. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE WAS ASKED TO FURNISH THE CONFIRMATIONS FROM ALL THOSE PERSONS TO WHOM SHARES WERE ALLOTTED DURING THE YEAR ALONG WITH COPIES OF THEIR BANK STATEMENTS, AUDITED ACCOUNTS FOR THE YEAR UNDER CONSIDERATIO N AND ITR S FOR THE YEAR UNDER CONSIDERATION. IN RESPONSE TO THAT THE ASSESSEE HAS FURNISHED THE SAME. ON PERUSAL OF THE DETAILS FURNISHED IN RESPECT OF PAID - UP SHARE CAPITAL, IT HAS BEEN NOTICED THAT DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE COMPAN Y HAS ALLOTTED 100,000 SHARES OF RS.10/ - EACH TO JEEWANDHARA WATERS (P) LTD. 23 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. 1.2 ON PERUSAL OF THE AUDITED ACCOUNTS OF JEEWANDHARA WATERS (P) LTD. FOR THE A.Y. 2005 - 06, IT HAS BEEN NOTICED THAT THE SAID COMPANY HAS SHOWN INVESTMENTS AS ON 31.3.2005 AT RS.5 1,844,000/ - . ON PERUSAL OF THE SCHEDULE OF INVESTMENTS, IT HAS BEEN NOTICED THAT THE NAME OF THE ASSESSEE COMPANY DID NOT APPEAR IN THAT SCHEDULE. BESIDES THIS, THERE IS NO HEAD IN THE BALANCE SHEET WHEREIN THE SAID ALLOTMENT OF SHARES OF ASSESSEE COMPANY COULD BE SHOWN. THE OTHER MAJOR HEAD (IN EXCESS OF RS.1,000,000/ - ) IN THE BALANCE SHEET OF JEEWANDHARA WATERS (P) LTD. IS LOANS & ADVANCES. THE SCHEDULE OF LOAN & ADVANCES ALSO DID NOT CONTAIN THE NAME OF THE ASSESSEE COMPANY. THUS, THE AMOUNT OF RS.1,000, 000/ - , WHICH THE ASSESSEE HAS SHOWN TO HAVE RECEIVED FROM JEEWANDHARA WATERS (P) LTD. ON ACCOUNT OF SHARE CAPITAL IS NOT REFLECTED IN THE BALANCE SHEET OF JEEWANDHARA WATERS (P) LTD. AS ON 31.3.2005. UNDER THESE CIRCUMSTANCES THE CLAIM OF THE ASSESSEE REGA RDING ISSUE OF SHARE CAPITAL TO JEEWANDHARA WATERS (P) LTD. REMAINED UNEXPLAINED AND UNVERIFIED AND ACCORDINGLY, THE SUM OF RS. 1,000,000/ - CREDITED IN THE BOOKS OF THE ASSESSEE COMPANY IS TREATED AS UNEXPLAINED CASH CREDIT. HENCE, AN ADDITION OF RS.1,000,0 00/ - IS MADE IN THE INCOME OF THE ASSESSEE COMPANY U/S 68 OF THE INCOME TAX ACT, 1961. IN VIEW OF THE ABOVE DISCUSSION, THE UNDERSIGNED IS SATISFIED THAT THE ASSESSEE HAS CONCEALED ITS INCOME TO THE TUNE OF RS.1,000,000/ - AND FOR THAT PENALTY PROCEEDINGS U /S 271(1)(C) HAVE BEEN INITIATED SEPARATELY. (ADDITION OF RS.1,000,000/ - ) 1 3 . ON PERUSAL OF THE AFORESAID ASSESSMENT ORDER, IT IS CRYSTAL CLEAR THAT THE AO ASKED THE ASSESSEE ABOUT THE INCREASE IN THE SHARE CAPITAL AND CATEGORICALLY STATED THAT THE ASS ESSEE WAS ASKED TO FURNISH THE CONFIRMATION FROM ALL SIX PERSONS BUT WHOM SHARES WERE ALLOTTED YEAR BY YEAR ALONGWITH THE COPIES OF THEIR BANK STATEMENT, AUDITED ACCOUNT 24 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. AND ITRS FOR THE YEAR UNDER CONSIDERATION WHICH WERE FURNISHED BY THE ASSESSEE. THE AO WAS SATISFIED WITH THE DETAILS FURNISHED BY THE ASSESSEE EXCEPT FOR 1,00,000 SHARES OF RS.10/ - EACH ALLOTTED TO M/S JEEVANDHARA WATERS PVT. LTD. WHICH WERE ADDED TO THE INCOME OF THE ASSESSEE AND FINALLY THE ASSESSMENT WAS FRAMED AT AN INCOME OF RS.5,83,1 77/ - . THEREAFTER, A SEARCH U/S 132 OF THE ACT WAS AGAIN CARRIED OUT ON 19.01.2009 ON THE ASSESSEE COMPANY. HOWEVER, THE ASSESSMENT WAS FRAMED BY MAKING THE ADDITION OF RS.1,05,00,000/ - ON ACCOUNT OF SHARE CAPITAL AND ANOTHER ADDITION OF RS.10,00,000/ - WHIC H WAS INCLUDED IN THE ABOVE SAID AMOUNT AND ALREADY ADDED ON ACCOUNT OF SHARES ALLOTTED TO M/S JEEVANDHARA WATERS PVT. LTD. IT IS, THEREFORE, CLEAR THAT NO FRESH INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH WHICH TOOK PLACE ON 19.01.2009. I T IS ALSO NOTICED THAT THE LD. CIT(A) IN THE IMPUGNED ORDER AT PAGE NO. 17 NOTED AS UNDER: IN APPELLANT S CASE, A RESULT OF SEARCH & SEIZURE, DOCUMENTS WERE SEIZED ON THE BASIS OF WHICH ADDITION HAS BEEN MADE ON UNACCOUNTED STOCK FOR OTHER ASSESSMENT YEARS U/S 153A FOR A.Y. 07 - 08 & 08 - 09. THEREFORE, THERE ARE SEIZED MATERIALS PERTAINING TO OTHER ASSESSMENT YEARS WITHIN THE PERIOD OF SIX YEARS U/S 153A. HENCE, THE ABOVE DECISION IS SQUARELY APPLICABLE. ACCORDINGLY, THE ASSESSING OFFICER HAS THE JURISDIC TION TO ASSESS TOTAL INCOME INCLUDING ADDITION U/S 68 OF I.T. ACT FOR SHARE CAPITAL OR SHARE APPLICATION MONEY ETC. EVEN THOUGH NO ADDITION WAS MADE IN O RIGINAL ASSESSMENT PROCEEDINGS. 14 . FROM THE AFORESAID NOTINGS ALSO, IT IS CLEAR THAT NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH FOR THE ASSESSMENT YEARS 2005 - 06 AND 2006 - 07 WHICH ARE UNDER CONSIDERATION. THE LD. 25 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. CIT(A) STATED IN THE IMPUGNED ORDER THAT THE ADDITION HAD BEEN MADE ON ACCOUNT OF UN ACCOUNTED STOCK FOR THE ASSESSMENT YEARS 2007 - 08 AND 2008 - 09. THEREFORE, IT IS AN ADMITTED FACT THAT THERE WAS NO INCRIMINATING MATERIAL AS REGARDS TO UNACCOUNTED STOCK, IF ANY, FOR THE YEARS UNDER CONSIDERATION. IN THE PRESENT CASE, T HE CONTENTION OF THE ASSESSEE FOR THE ADDITION S ON ACCOUNT OF UNACCOUNTED STOCK FOR THE ASSESSMENT YEARS 2007 - 08 AND 2008 - 09 , WAS THAT THE ADDITION FOR THE ASSESSMENT YEAR 2007 - 08 HAS BEEN DELETED BY THE LD. CIT(A) WHILE THE ISSUE WAS PENDING FOR THE ASSESSMENT YEAR 2008 - 09 RE LATING TO THE STOCK BEFORE THE SALES TAX AUTHORITIES. THE SAID CONTENTION WAS NOT REBUTTED BY BRINGING ANY COGENT MATERIAL ON RECORD. FROM THE AFORESAID DISCUSSION, IT IS CLEAR THAT ALTHOUGH NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH H ELD ON 19.01.2009 STILL THE IMPUGNED ADDITIONS WERE MADE FO R THE YEARS UNDER CONSIDERATION. 15 . ON A SIMILAR ISSUE THE HON BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS KABUL CHAWLA REPORTED AT (2016) 380 ITR 573 HELD AS UNDER: ''THE LEGAL POSITION THAT EMERGES ON A PERUSAL OF SECTION 153A AND SECTION 132 OF THE INCOME - TAX ACT, 1961, IS AS UNDER : (I) ONCE A SEARCH TAKES PLACE UNDER SECTION 132 OF THE ACT, NOTICE UNDER SECTION 153A(1) WILL HAVE TO BE MANDATORILY ISSUED TO THE PERSON IN RESPECT OF WHO M SEARCH WAS CONDUCTED REQUIRING HIM TO FILE RETURNS FOR SIX ASSESSMENT YEARS IMMEDIATELY PRECEDING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR IN WHICH THE SEARCH TAKES PLACE, (II) ASSESSMENTS AND REASSESSMENTS PENDING ON THE DATE OF THE SEARCH SHAL L ABATE. THE TOTAL INCOME FOR SUCH ASSESSMENT YEARS WILL HAVE TO BE COM PUTED BY THE ASSESSING 26 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. OFFICERS AS AFRESH EXERCISE. (II I) THE ASSESSING OFFICER WILL EXERCISE NORMAL ASSESSMENT POWERS IN RESPECT OF THE SIX YEARS PREVIOUS TO THE RELEVANT ASSESSMENT Y EAR IN WHICH THE SEARCH TAKES PLACE. THE ASSESSING OFFICER HAS THE POWER TO ASSESS AND REASSESS THE 'TOTAL INCOME' OF THE SIX YEARS IN SEPARATE ASSESSMENT ORDERS FOR EACH OF THE SIX YEARS. IN OTHER WORDS, THERE WILL BE ONLY ONE ASSESSMENT ORDER IN RESPECT OF EACH OF THE SIX ASSESSMENT YEARS IN WHICH BOTH THE DISCLOSED AND THE UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX. (IV) ALTHOUGH SECTION 153A DOES NOT SAY THAT ADDITIONS SHOULD BE STRICTLY MADE ON THE BASIS OF EVIDENCE FOUND IN THE COURSE OF THE SEARCH, O R OTHER POST - SEARCH MATERIAL OR INFORMATION AVAILABLE WITH THE ASSESSING OFFICER WHICH CAN BE RELATED TO THE EVIDENCE FOUND, IT DOES NOT MEAN THAT THE ASSESSMENT CAN BE ARBITRARY OR MADE WITHOUT ANY RELEVANCE OR NEXUS WITH THE SEIZED MATERIAL. OBVIOUSLY, A N ASSESSMENT HAS TO BE MADE UNDER THIS SECTION ONLY ON THE BASIS OF THE SEIZED MATERIAL (V) IN THE ABSENCE OF ANY INCRIMINATING MATERIAL, THE COMPLETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSMENT OR REASSESS - MENT CAN BE MADE. THE WORD 'ASSESS' I N SECTION 153A IS RELATABLE TO ABATED PROCEEDINGS (I.E., THOSE PENDING ON THE DATE OF SEARCH) AND THE WORD 'REASSESS ' TO COMPLETED ASSESSMENT PROCEEDINGS, (VI) IN SO FAR AS PENDING ASSESSMENTS ARE CONCERNED, THE JURISDICTION TO MAKE THE ORIGINAL ASSESSMEN T AND THE ASSESSMENT UNDER SECTION 153A MERGES INTO ONE. ONLY ONE ASSESSMENT SHALL BE MADE SEPARATELY FOR EACH ASSESSMENT YEAR ON THE BASIS OF THE FINDINGS OF THE SEARCH AND ANY OTHER MATERIAL EXISTING OR BROUGHT ON THE RECORD OF THE ASSESS ING OFFICER, (V II) COMPLETED ASSESSMENTS CAN BE INTERFERED WITH BY THE ASSESS ING OFFICER WHILE MAKING THE ASSESSMENT UNDER SECTION 153A ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS OR UNDISCLOSED INCO ME OR PROPERTY DISCOVERED IN THE COURSE OF SEARCH WHICH WERE NOT 27 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. PRODUCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT. IT HAS FURTHER BEEN HELD AS UNDER: ON THE DATE OF THE SEARCH THE ASSESSMENTS ALREADY STOOD COMPLETED. SINCE NO INCRIMINATING MATERIAL WAS UNEARTHED DURING THE SEARCH, NO ADDITIONS COULD HAVE BEEN MADE TO THE INCOME ALREADY ASSESSED.' 16. SIMILARLY, IN THE CASE OF PR. CIT VS MEETA GUTGUTIA PROP. M/S FERNS AND PETALS (2017) 395 ITR 526 (DEL.), THE HON BLE JURISDICTIONAL HIGH COURT BY DISTINGUISHING THE DECISION IN THE CASE OF SMT. DAYAWANTI GUPTA VS CIT REPORTED AT (2016) 390 ITR 496 WHICH WAS RELIED BY THE DEPARTMENT AND ALSO BY CONSIDERING THE DECISION S IN THE CASE S OF CIT VS ANIL KUMAR BHATIA (2013) 352 ITR 493 (DEL.), FILATEX INDIA LTD. VS CIT (2015) 229 TAXMAN 555 (DEL.) AND CIT VS CHETAN DAS LACHMAN DAS (2012) 254 CTR 392 (DEL.) FOLLOWED THE DECISION IN THE CASE OF CIT VS KABUL CHAWLA (SUPRA) AND HELD AS UNDER: POWER UNDER SECTION 153A OF THE INCOME - TAX ACT, 1961 ENABLES THE ASSESSING AUTHORITY TO REOPEN THE ASSESSMENTS FOR SIX YEARS PRIOR TO THE YEAR OF SEARCH UNDER SECTION 132, IF DURING THE COURSE OF SEARCH UNDER SECTION 132 INCRIMINATING MATERIAL JUSTIFYING T HE REOPENING OF THE ASSESSMENTS FOR THE SIX PREVIOUS YEARS IS FOUND. ANY AND EVERY DOCUMENT CANNOT BE AND IS NOT AN INCRIMINATING DOCUMENT. NO ADDITION CAN BE MADE FOR A PARTICULAR ASSESSMENT YEAR WITHOUT THERE BEING AN INCRIMINATING MATERIAL QUA THAT ASS ESSMENT YEAR WHICH WOULD JUSTIFY SUCH AN ADDITION. 28 ITA NOS. 3049 & 3050 /DEL/201 3 GAHOI CHEMICALS PVT. LTD. 17. WE, THEREFORE, CONSIDERING THE TOTALITY OF THE FACTS AS DISCUSSED HEREINABOVE AND BY KEEPING IN VIEW THE RATIO LAID DOWN BY THE HON BLE JURISDICTIONAL HIGH COURT IN THE AFORESAID REFERRED TO CASE S DEL ETE THE ADDITION MADE BY THE AO IN THE ABSENCE OF INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH HELD ON 19.01.2009 , BY PASSING THE ASSESSMENT U/S 153 A R.W.S. 143(3) OF THE ACT ON 29.12.2010, WHICH WAS CONFIRMED BY THE LD. CIT(A) VIDE IMPUGNED OR DER. 18. FOR THE ASSESSMENT YEAR 2006 - 07 IN ITA NO. 3050/DEL/2013, THE FACTS ARE IDENTICAL TO THE FACTS INVOLVED IN ITA NO. 3049/DEL/2013 FOR THE ASSESSMENT YEAR 2005 - 06 WHICH WE HAVE ALREADY ADJUDICATED I N THE FORMER PART OF THIS ORDER, T HEREFORE, OUR FI NDINGS GIVEN THEREIN SHALL APPLY MUTATIS MUTANDIS FOR THE ASSESSMENT YEAR 2006 - 07 ALSO. 19 . IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLOWED . (ORD ER PRONOUNCED IN THE COURT ON 2 2 /08/2017) S D / - S D / - (KULDIP SINGH) (N. K. SAINI) JUDICIAL ME MBER ACCOUNTANT MEMBER DATED: 2 2 /08/2017 *SUBODH* COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(APPEALS) 5 . DR: ITAT ASSISTANT REGISTRAR